Netflix Soars Past Expectations, Reed Hastings Steps Down

• Netflix (NASDAQ: NFLX) exceeded Wall Street’s expectations in Q4, gaining 7.66 million paid subscribers.
• The significant addition to its subscribers in Q4 increased the company’s shares by 6%.
• Co-founder Reed Hastings is stepping down as the CEO.

Netflix (NASDAQ: NFLX) recently announced their fourth quarter financial results, which exceeded Wall Street’s expectations. The company gained 7.66 million paid subscribers, over the predicted 4.57 million, resulting in a 6% increase in their stock. At the time of writing, the company’s stock is up 7.12% in after-hours trading to $338.27. NFLX has seen positive growth since the beginning of the year, with a 9.05% increase in the last three months and 7.06% in the past month.

The fourth quarter financial results also marked the first time Netflix’s latest tier was added to their earnings report; the ad-supported service titled “Basic with Ads”. This service was rolled out in the US last year at a price point of $6.99 per month and provides access to the streaming giant’s library with limited commercials.

In light of the impressive results, the company’s co-founder Reed Hastings announced his decision to step down as the CEO. He will continue to serve as the Chairman of the Board of Directors and will be succeeded by current Chief Content Officer Ted Sarandos. Sarandos has been with the company since 2000 and is well-suited to take over the leadership role.

This news comes after the streaming giant has seen significant growth in 2020. The company added 37 million new subscribers in the US, Canada, and Latin America, making it the biggest year of subscriber growth in the company’s history. Netflix achieved this growth despite the pandemic and competition from other streaming services.

Overall, Netflix’s Q4 results exceeded Wall Street’s expectations and the company’s stock has seen positive growth in the past year. Co-founder Reed Hastings is stepping down as the CEO and will be succeeded by current Chief Content Officer Ted Sarandos. With Sarandos at the helm, Netflix is sure to continue its growth and success.

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